Baton Rouge tech company ParkZen finds its place | Innovation

ParkZen, a Baton Rouge tech startup that helps drivers find parking spots, has found a permanent space of its own.

Last week, Houston-based Parking Guidance Systems announced that it has purchased ParkZen in a deal that combines an undisclosed amount of cash and equity. The transaction follows two years of collaboration between the two companies.

“This is a huge opportunity for us,” ParkZen co-founder Manos Chatzopoulos said Tuesday by phone while attending an industry trade show. “I’ve been getting congratulations from people in the industry all morning.”

Citing a nondisclosure agreement, Chatzopoulos said he was unable to share details of the acquisition, but industry insiders estimate the deal was worth several million dollars. 

Parking Guidance CEO Derek Frantz didn’t respond to requests for comment

Co-founded in 2020 by Chatzopoulos, an LSU associate professor of astrophysics, and real estate financier George Triarchou, ParkZen uses smartphone data to help drivers hunt for parking spaces in the same way that Waze or Apple’s maps help them avoid traffic snarls. The company’s customers include universities, airports and other businesses around the country.

Parking Guidance, which has been in business since 2013, installs and operates parking technology hardware, including sensors installed on the ceilings of parking garages to track availability of parking spaces.

The companies teamed up in 2023 to provide parking hardware and software for the Baltimore/Washington International Airport.

“The airport was looking for a consumer-facing app to remind drivers where their car was parked based on license plate data,” Chatzopoulos said. “We came along for the ride on that project and built the mobile app.”

The successful collaboration set the stage for the recent acquisition.

The deal comes at a time when the roughly $120 billion U.S. parking industry looks for ways to boost profits despite challenges created by the rise of remote work, ride-hailing platforms and e-commerce — all of which have reduced demand.

Companies that own or manage parking lots are turning to tech companies to help them maximize profits, according to industry reports. Solutions include apps that let drivers reserve spaces in advance, sensors that automatically charge drivers when they pull in and out of parking spaces, and tech that will automatically adjust prices for parking spaces based on demand.

Parking Guidance’s acquisition of ParkZen gives the company more artificial intelligence-driven and data-driven software solutions for its customers, said Chatzopoulos.

Icy inspiration

Chatzopoulos began brainstorming a tech solution to parking a decade ago, when he was a postdoctoral fellow at the University of Chicago. His daily routine involved lots of driving around looking for a parking space, followed by long walks in cold conditions.

He figured there had to be a better way to avoid parking hassles, which he said cause unnecessary carbon emissions, loss of productivity and traffic accidents.

Chatzopoulos, who by day uses supercomputer simulations to understand supernovas and stellar evolution, applied his skills in data analysis to tackle the more down-to-earth challenge.

“I realized most parking problems weren’t just about too few spots; they were about people not knowing where open spots actually were,” he said. “I knew I could use data to bridge that information gap and make parking way less stressful.”

After he started working at LSU in 2016, Chatzopoulos joined forces with Triarchou to launch ParkZen.

Today, ParkZen is used by about a dozen schools, including the University of Alabama and the University of Tennessee. The startup also has a $2 million contract with the Virginia Department of Transportation covering 59 commuter parking lots. Chatzopoulos declined to disclose revenue details, citing competitive concerns.

‘Great example of incubation’

In 2022, ParkZen won a $100,000 investment after taking first place in a pitch competition during Baton Rouge Entrepreneurship Week, run by the nonprofit business incubator Nexus Louisiana.

The investment came from Innovation Catalyst, a Baton Rouge-based nonprofit that invests in local entrepreneurs, and its subsidiary, the Red Stick Angel Network.

Chatzopoulos used the injection of cash to hire a salesperson and software developers. The company also became a “virtual tenant” at Nexus, where it received coaching and other support services.

Nexus President and CEO Tony Zanders said ParkZen’s Parking Guidance deal is proof that the Baton Rouge entrepreneurial ecosystem works — even if the deal isn’t as splashy as the 2021 exits of New Orleans tech companies Lucid, Levelset and Turbosquid. The Lucid deal alone was worth more than $1 billion.

Bill Ellison, CEO of Innovation Catalyst and the Red Stick Angels, said he was planning another major investment in ParkZen, along with a South Carolina-based venture capital fund, when Parking Guidance made its acquisition offer.

“We had the deal done, but Manos said he had an offer to be acquired that was too good to pass up,” Ellison said.

‘Leading innovation’

For Chatzopoulos, the Parking Guidance deal is a chance to offload some of the responsibilities of a startup founder so he can focus on his favorite aspects of the business — leading innovation. 

He wants to continue to make parking easier for students, and he envisions a day when enough drivers are using his software that it will work outside of designated parking lots.

He also hopes to sell ads based on customers’ locations. And he wants to grow the company’s services in the paid parking sector, which he describes as a more “dense and competitive space.”

Now, he’ll be pursuing those goals as part a more established venture that has installed roughly 200 parking guidance systems encompassing 360,000 parking spaces at airports, universities, hospitals and corporate campuses.

The company has offices in Houston, Dallas, Orlando, Miami, San Diego, Washington, D.C., and, now, Baton Rouge. Both ParkZen partners and all three employees will remain with the company.

“This is what Silicon Valley calls an ‘acqui-hire,’” Zanders said. “They aren’t just buying the ParkZen tech and sending the team off to Hawaii for a vacation. The skills they are bringing to the table will help PGS further expand into the software space.”